US Won't Renew USMCA, Signaling Trade Deals Remain Open for Revision

Hello, this is Hui Jie writing to you from Singapore. Welcome to another edition of CNBC's Daily Open.

The U.S. has opted not to renew the United States-Mexico-Canada Agreement, known as USMCA. For a pact that President Donald Trump once hailed as "the best agreement we've ever made," Washington is now signaling that even its own trade deals can remain open for revision.

In markets, tech stocks are, of course, the standout winner for the first half of the year. But the biggest gains have not come from Silicon Valley.

Read on!

The U.S. will not renew the United States-Mexico-Canada Agreement, or USMCA, opening the door to fresh negotiations with Canada and Mexico over a pact Trump once called "the best agreement we've ever made."

Instead, Washington has chosen to conduct annual reviews of the trade pact, with an administration official saying that Trump "chose not to rubber stamp a USMCA renewal without addressing existing issues."

Chief among those issues for Trump are the trade deficits with the two trading partners, according to the official.

In June, the U.S. President said: "We don't need anything that Canada has. We don't need anything that Mexico has, but they need everything that we have. And they have to treat us better."

Trump is set to appear in an interview with CNBC's Joe Kernen that will air at 5pm Thursday stateside.

For markets and America's trading partners, the message is clear: under Trump, even agreements that appear settled may not be a done deal.

Another example is South Korea, which could also face additional scrutiny after a House Judiciary Committee report found that Seoul acted in a discriminatory manner toward certain U.S. companies, including U.S.-based online retailer Coupang .

The committee argued South Korea's actions against Coupang violate provisions of the trade deal renegotiated in 2025 as part of Trump's sweeping global tariff agenda.

Elsewhere, the path for monetary policy remains uncertain. Federal Reserve Chairman Kevin Warsh declined to offer guidance on what the central bank might do at its meeting later this month, though he acknowledged that inflation remains too elevated.

Fresh economic data also pointed to a cooling labor market. U.S private payrolls grew by a seasonally adjusted 98,000 in June, according to payrolls processing firm ADP, below the Dow Jones consensus forecast for 110,000. The gain also marked a slowdown from May's unrevised increase of 122,000.

Markets, meanwhile, are entering the second half with a familiar winner but an unexpected geographic twist.

Tech powered much of the first-half rally, yet the biggest gains did not come from Silicon Valley. Instead, emerging markets, led by South Korea's Kospi , stole the spotlight.

On Wednesday, U.S. markets slipped as investors pared positions in tech, but Meta was an outlier, popping nearly 9% after news that the company is building a new cloud business that could help recoup some of the billions it has committed to artificial intelligence infrastructure.

— Lim Hui Jie